Iron Mountain Archiving Dis-Connected

Iron Mountain Inc. (NYSE: IRM) is pulling the plug on its email archiving product just two months after the company acquired it.

The records-management giant will discontinue its ArchiveStore/EM product next year because of overlap with its existing Digital Archives outsourced service, says company spokesperson Lauren Drapala. ArchiveStore/EM became part of the Iron Mountain portfolio with the acquisition of Connected Corp. in October (see Iron Mountain Gets Connected). Connected itself acquired the product through its purchase of Archive-it (see Connected Gets Into Archive).

Iron Mountain will deliver the final version of the product early next year and cease supporting it altogether by the end of 2005. Links to product information on Connected's Website have already been removed and disabled.

"Maintaining, supporting, marketing, and selling two solutions for one need were not in the best interest of the customers or the business," writes Drapala in an email to Byte and Switch.

Iron Mountain chose to keep its Digital Archives service over Connected's product because it "has a market leadership position, supports more platforms and electronic records types, and has supervision capabilities in line with both the Iron Mountain and Connected visions to provide compliant archiving across digital data types," the spokeswoman adds.Industry observers believe ArchiveStore's demise stemmed from conflicting solutions, but not with the Iron Mountain service.

"Iron Mountain had gotten into a conundrum because of Connected's agreement with AmeriVault," says Adam Couture, principal analyst at Gartner Inc. "AmeriVault offers a [service] based on the Connected archiving product, so Iron Mountain was enabling competitors."

Despite the logic of it, the decision did take some by surprise -- including AmeriVault Corp.

"I honestly didn't know about it," says Scott Bush, marketing director at AmeriVault, when told of the news. "We're not stupid, we knew something could happen. But our initial read was that things would stay the same."

AmeriVault launched its service in August, prior to Iron Mountain's deal to grab Connected. The startup service provider will now have to look elsewhere to license an archiving product, though Bush claims the transition will not be difficult because AmeriVault has only a dozen archiving customers. The majority of the company's business comes from online backup services.Meanwhile, other email archiving providers have scrambled to expand their offerings in the hot archiving and compliance market. Earlier this year, Veritas Software Corp. (Nasdaq: VRTS) bought market leader KVS Inc., while Zantaz Inc. snatched up competitor Educom TS. Last year, EMC Corp. (NYSE: EMC) gained an email archiving product in its acquisition of Legato Software. (See No Brainer: Veritas Buys KVS, Zantaz Makes Compliance Buy, and EMC Gobbles Legato.)

ArchiveStore/EM has lagged behind market leaders such as KVS, Educom, Legato, and iLumin Software Services Inc.. Iron Mountain estimates about 25 customers for ArchiveStore.

The company has contacted those customers and "introduced" them to the Digital Archives service in hopes they'll stay in the fold, says Melissa Burman, director of corporate communications at Iron Mountain.

Iron Mountain will also roll features and code from ArchiveStore into Digital Archives, she added. Those upgrades are expected within 18 months.

Brett Mendel, Senior Analyst, Byte and Switch Insider0